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The congregation was founded in 1887.[2] The present building was erected in 1909, one year after the great fire that destroyed a third of the buildings in the city. The architect was Harry Dustin Joll. The congregation's previous building was destroyed in the great fire.[3]

It is the oldest surviving synagogue in Chelsea, a city that was one-third Jewish at the time the synagogue was built.[4]

The synagogue possesses a "remarkable" series of wall and ceiling frescoes painted by Jewish immigrant artists.[5] The "magnificent" carved Torah Ark was created by a noted Boston-area cabinetmaker who specialized in synagogue furniture, San Katz, in the 1920s.[4] The synagogue was added to the National Register of Historic Places in 1993.

In 2016, Congregation Agudath Shalom hired Rabbi Lila Kagedan as its full-time spiritual leader. Kagedan is the first graduate of Yeshivat Maharat to take the title of Rabbi for her work as a female Orthodox leader. She had previously worked and taught in the Boston area for over ten years. The Synagogue continues to operate as an Orthodox Shul.[6]